Criminal law: Court clarifies meaning of “loss” in sentencing guidelines

The District Court did not err in holding that, for the purposes of calculating the sentence imposed on a woman convicted of filing false tax returns with the tax authorities, “loss” includes both actual damage and damage that was the subject of the fraud.

background

Maggie Boler was found guilty of six counts of making false claims against the United States by submitting false tax returns to the Internal Revenue Service (IRS) and one count of making false statements on her fraudulent Paycheck Protection Program loan application. The defendant filed six tax returns with the IRS but received a refund for only four of those returns. Boler argued that the two tax returns rejected by the IRS should not be considered in calculating damages for sentencing purposes. The district court disagreed.

analysis

The Court agrees with the Government’s view that the context of section 1B1.3 applies to this Court’s interpretation of the term “loss” under section 2B1.1. The relevant Code of Conduct provides direction to courts on how to consider “harm” in the context of specific offense elements.[u]unless otherwise stated.”

In this case, Section 2B1.1 does not explicitly limit “loss” to actual or intended loss. Therefore, the language in Section 1B1.3 provides a starting point for interpreting the expansions in Section 2B1.1. Read together, Sections 1B1.3 and 2B1.1 of the Guidelines support the understanding that “loss” must include both actual damage and damage that was the subject of the complainant’s plan.

The complainant argues that “loss” should be limited to “actual loss” because the Commission omitted any reference to intended harm. In the complainant’s view, the decision to omit explicit language such as “intended loss” from Section 2B1.1 was deliberate because similar language is present in other sections of the Guidelines.

But section 2B1.1 does not define “loss” and does not suggest that intended loss should be excluded from its definition. And as discussed earlier, the relevant conduct that the criminal court is required to consider under Guideline § 1B1.3 is more than just material damage—it also includes unoccurred but intended loss.

Moreover, the Court’s interpretation of section 2T1.1(c)(1) compared to section 1B1.3(a) does not “supersede” the language of other sections of the Guidelines. The reference to section 2T1.1(c)(1) of the Guidelines is not a useful standard of comparison. It simply does not apply here.

By publishing the guidelines, the Commission wanted to “establish sentencing guidelines and practices for the federal criminal justice system that … avoid[] unjustified disparities in sentencing between defendants with similar criminal records who have been convicted of similar criminal acts.” Appellant’s limited interpretation of the term “loss” could result in different sentencing decisions for defendants with similar levels of culpability. For example, if criminal courts considered only “actual loss” when deciding on the specific characteristics of the crime, defendants with equal levels of culpability for the same criminal acts would receive longer sentences simply because one, for one reason or another, was able to successfully carry out his fraudulent plan while the other could not.

Because the definition of “loss” in the Guidelines is ambiguous, the Court next considers whether the Commentary’s definition of “loss” falls within the “area of ​​ambiguity” and should be given consideration. The Court considers that the nature and context of the Commentary give it critical meaning.

In summary, the district court properly relied on the Commentary in determining the appropriate amount of loss in appellant’s case because the Commentary defined the loss within the “zone of ambiguity” created by § 2B1.1 of the Guidelines and because the “character and context” of the Commentary support its “significant weight.”

Confirmed.

Dissenting opinion

Quattlebaum, J., dissenting opinion:

“Loss” is not ambiguous. “Loss” means actual loss, not intended loss. Because the Guidelines Commentary’s interpretation of “loss” in § 2B1.1(b)(1) to include intended loss is both inconsistent and a clear misinterpretation of the Guidelines, no deference to the Commentary is warranted.

And because the district court made a § 2B1.1(b)(1) increase based on intended loss rather than actual loss, I would vacate judgment and remand the case for a new trial with instructions to the district court to calculate the range under the Boler guidelines without considering intended loss for purposes of a § 2B1.1(b)(1) increase.

United States v. Boler, Case No. 23-4352, August 23, 2024. 4th Cir. (Thacker), of DSC in Columbia (Wooten). Jeremy A. Thompson for appellant. Tommie DeWayne Pearson for respondent. VLW 024-2-250. 51 pages.